A planned merger of the University of Edinburgh and Edinburgh College of Art (ECA) has been granted £13.8m of public money.

The deal takes a merger one step closer, with the Scottish parliament set to vote on it later this year.

The grant, from the Scottish Funding Council, follows criticism last year that it previously denied ECA a lifeline.

ECA staff have said they expect the merger to result in a more research-based approach to their work.

Today education secretary Mike Russell criticised the financial management of ECA. He said he was hopeful the cash could help both institutions move forward, but said he made the announcement with 'regret.'

You can see his letter to the principals of both education establishments below.

The decision follows a 12-week public consultation on proposals - which were said to have had the "overwhelming" backing of the two institutions - drawn up last year.

Russell said the academic case for merger was compelling but criticised the financial management of the ECA.

He said that, even with this new investment, ECA could not deliver a long-term, sustainable funding situation as an independent institution:

"I have listened to all views and representations received over recent weeks and have decided to back merger plans that have the overwhelming support of both institutions. Whilst I recognise the benefits that will result, I have approved the merger with regret as well as anticipation.

"It is clear that the financial situation within ECA is unsustainable in the medium to longer term. This position should not have been allowed to develop, and it points towards very significant weaknesses in ECA's internal controls and governance structures at crucial stages in recent years.

"Even with £13.8 million of additional public money now being made available, the scale of the difficulties at ECA mean that even this significant injection of funds would not have made ECA financially sustainable. I very much regret that these matters have overshadowed, and had a bearing on, my decision."

On a more positive note, Russell said he hoped ECA could maintain its own identity. More than 20% of ECA's students are from abroad and it is hoped ECA's international profile will be strengthened further by the merger. He said:

"I do recognise the significant academic benefits of joining two institutions with outstanding reputations and histories of success. I am encouraged that the University is committed to raising ECA's already strong international profile and that major new activity, in both teaching and research, will be pursued.

"Given that both staff and student bodies have supported the merger, I believe they must be rewarded with an enhanced College of Art, with its identity and ethos not simply maintained but allowed to develop and flourish in the years ahead."

If final approval is granted by ministers, the merger is likely to be implemented on August 1.

The university said earlier:

"The merger proposal is based on Edinburgh College of Art retaining its name, brand identity, pedagogical methods and other distinctive strengths, whilst being supported through the University's underlying systems and processes."